Macy's, a symbol of traditional shopping, now offers same-day delivery

﻿Macy's, which operates eight department stores in Houston, has begun offering same-day delivery in this and eight other major markets.

﻿Macy's, which operates eight department stores in Houston, has begun offering same-day delivery in this and eight other major markets.

Image 2 of 2

Macy's will start offering same-day delivery in Houston for online orders this fall.

Macy's will start offering same-day delivery in Houston for online orders this fall.

Macy's, a symbol of traditional shopping, now offers same-day delivery

1 / 2

Back to Gallery

The latest retailer to offer time-strapped shoppers same-day home delivery is one of the most traditional. Macy's, a mall staple, will bring customers in select cities sport coats and evening dresses, lipstick and flatware within a two-hour window of their choosing for just $5 extra.

The eight Macy's department stores in Houston join those in eight other major markets, from Los Angeles to Washington, D.C., in offering the same-day service.

"Our goal remains to help our customers shop whenever, wherever and however they prefer, and to use the entire inventory of the company to satisfy demand," Macy's CEO Terry J. Lundgren said in a statement.

The service is the latest example of the ways online giant Amazon changed the game and put other retailers on the defensive.

Translator

To read this article in one of Houston's most-spoken languages, click on the button below.

"Everybody understands the battle is with Amazon," said Howard Davidowitz, chairman of Davidowitz and Associates, a national retail consulting and investment banking firm in New York. Retail growth is in online, and same-day delivery is another way for retailers to capture that market, Davidowitz said.

Macy's, which started offering in-store pickup for online purchases last fall, launched same-day home delivery about three weeks ago through a Silicon Valley-based company, Deliv. In addition to the $5 delivery fee, the store charges $14.99 for shipping on purchases of less than $100. The shipping fee is waived for orders of more than $100.

Customers must place orders by 1 p.m. Monday through Saturday, and 11 a.m. on Sunday, and select the time window for delivery.

Growing trend

Next year, Galleria stores will jump on board, too, a mall spokeswoman said. She did not know which or how many stores will offer the service.

The trend is growing nationwide as competition for customers increases. Consumers want convenience and some just seem to find traditional shopping draining.

"A lot of shopping is kind of designed around a different time, when people had more time, had more patience, had more fortitude," said Kit Yarrow, a consumer research psychologist at Golden Gate University. "I think people do still like going to stores too, but I've never heard consumers complain as loudly as they do today about hassles ... and those include hunting for a parking spot, paying for parking, waiting."

People's "emotional fortitude" is now "eaten up by the new stressors that people have in their day-in and day-out lives," she said.

It's easier to just order something online in 10 minutes at work, then try it on when you get home that night.

"People like the dressing room to be their bedroom," Yarrow said.

But "it's not an either/or," she said. "A lot of people want to force this into one category or another. ... Shoppers, they really want it all." She thinks shoppers are actively looking for the type of in-store experience they want, which involves less hassle and more engagement. Many people complain of poor in-store service and "just want to get out with as few bruises as possible," she said.

Amazon, one of the online pioneers, now offers same-day delivery in Dallas/Fort Worth and 12 other major metropolitan areas, for $5.99 for Amazon Prime members and $9.98 for non-members.

Daphne Carmeli, founder of Deliv, which is doing Macy's delivery service, realized that the business would only work if the fastest option was also the cheapest, or at least comparable.

When she looked into starting the company, she figured shoppers who use in-store pickup would value same-day delivery. They make up about 10 percent of online shoppers, she said. But in-store pickup is typically free and she wanted to reach 100 percent of consumers, so she would have to make on-demand delivery cheap, too.

The Menlo Park, Calif., company started in 2012 and now works with about 200 retailers in eight areas across the country. It entered the Houston market with Macy's at the end of October. It also saw demand here from 1-800-flowers and local malls.

Deliv keeps prices low by crowd-sourcing its employees. It has a network of drivers who work 10 to 20 hours a week on average for $20 an hour. It has no trucks or warehouses.

"We're changing the way people are thinking about it," Carmeli said. "We've made it the no-brainer choice."

Same-day delivery is one way for brick-and-mortar stores to take advantage of their physical footprint, which is often blamed for holding them back against online-only retailers. Deliv's trips average about four miles between store and consumer because retail chains already have so many locations.

Still, the service is likely to cut into retailers' margins.

"I would say many of the services right now do represent a profit loss, but that will change as this service scales upward," said Kelli Hollinger, director of the center for retailing studies at Texas A&M's Mays Business School.

"They're doing it because consumer behavior is changing," she said. "Shoppers can now shop from anywhere. Retailers are now working to provide services on the terms of the customer."

"If you have the bandwidth to do it, it's only to your advantage," said Bodge. She thinks that the excitement Macy's is generating around the service will drive sales enough to make up for any losses.

For many stores, Davidowitz sees it as: take the loss now, or get out.

Houstonians already have shown an appetite for this level of convenience. In August, San Francisco-based Instacart began same-day grocery delivery for several stores.

Matt O'Connor, who led the company's Houston launch, said demand was high immediately. He described the typical customers as "time-starved and tech-savvy, who want their groceries but dread the chore of going there."